Good morning & happy Monday!
Trusting God’s plan is the only secret I know in the gentle art of not freaking out. –
Lisa TerKeurst, author
When I attended the Kingdom Advisors conference in February, Lisa TerKeurst was one of the speakers. She was exceptionally engaging and refreshingly honest. As the president of Proverbs 31 Ministries, a wife and a mother of 5 children she shared some stories that were … well … very real. Life is not perfect, kids don’t always behave, spouses get into disagreements, life can be very challenging no matter who you are.
Let’s get real here … this market is challenging. It is no fun at all to watch as our account values drop. To watch our live savings reduce … it feels horrible.
Whenever we face difficult situations, our human nature tells us we need to DO SOMETHING!
Recently there was a thunderstorm at my home and the 2 dogs in our house (Tico & Baby Girl) started to freak out. A lightning bolt would flash, followed by a loud boom of thunder and the dogs would just loose it. They were scurry around the house going from one person to another person, to a corner, to under a desk, to a closet … then another boom of thunder and the entire process started all over again.
Even though there was nothing to be concerned about, the dog’s nature kicked in and they felt tremendous fear.
You and I both know that pacing the floor, running from room to room, and panting like crazy will not change one thing. The storm is going to do what the storm is going to do. If they took a nap or walked 10,000 steps around the house the end result would be the same … the storm would come, and the storm would go, and everything would be fine.
You see where I’m going with this?
The market is going to do what the market is going to do. There are only two types of people when it comes to know what the market is going to do … 1) those who don’t know and 2) those who don’t know they don’t know. Let’s be wise enough to know that we are in the 1st category.
But human nature tells us to DO SOMETHING! Change the portfolio. Cash out and wait for things to settle down. Move everything to gold and oil. For Pete’s sake, just do something!!!
In the short run these moves could make us feel like we’ve done something to stop the pain … but all we’ve really done is be reactive … and history teaches us that the long-term price to pay for being reactionary is significant, for some investors even financially fatal.
All successful investors are continuously acting on a plan, all unsuccessful investors are continually reacting to the markets.
I love to travel and many years ago my dad and I took a trip together out west. We had a packed schedule (surprising, right 😉) and only had a few hours at Bryce Canyon National Park. Well, by the time we got there it was pouring rain and we sat in the car in the parking lot watching the rain continue to completely ruin our plans. That is not what either of us wanted as we drove an extra couple of hours to visit this amazing destination. But you know what happened eventually? The rain stopped. After that not only did the sun start shining but there was a beautiful rainbow that filled the sky. It was a spectacular evening and one of the prettiest scenes I’ve ever seen.
In addition to that, we had the place to ourselves. Virtually all the other tourists left. They missed the beauty that followed the storm.
My friends, I understand the storm is here and it’s exceptionally challenging. I don’t know when the storm ends, but I know it does not last forever.
So, what are we supposed to do during times like this? I propose the beautiful answer, and the only correct answer I know, is to stick with the plan. Don’t freak out. Don’t get reactionary. Just let the storm pass through.
Thank you for allowing me to be a part of your journey. Feel free to reach out to us if we can help along the journey.